You Snooze…….You Lose…….

Those Who Wait Will Pay Thousands More This Spring 

Waiting a few extra days or weeks to purchase a home this spring could
cost buyers thousands of extra dollars as the office of Housing and
Urban Development (HUD) implements several changes for loans guaranteed
by the Federal Housing Authority (FHA).

Coming just weeks before the April 30 deadline for the Home Buyer Tax
Credit and just days after the March 31 expiration of the Federal
Reserve Board's mortgage backed securities purchase program (which has
kept home loan rates artificially low for over a year), these FHA
changes make it even more important to act now to save big.

Here are a few reasons why:

On April 5th, the cost of required up-front mortgage insurance for loans
guaranteed by the FHA will increase from 1.75% to 2.25%. For a borrower
purchasing a $200,000 home with a $7,000 down payment, the up-front
mortgage insurance will increase by $965. Up-front mortgage insurance is
typically financed in the final loan amount so the impact to a monthly
payment will be minimal but overall, the increase is still borne by the
borrower both upfront and monthly.

It is important to note that in order to be eligible for the lower cost
up-front mortgage insurance, a lender has to order a case number from
the FHA before April 5th. A case number can only be generated for loan
applications where a property is involved and a fully executed purchase
contract exists. Home buyers who have been pre-approved but are not
under contract will not be eligible for the reduced premium effective
April 5th.

Later this spring, the amount of money that a seller can return to the
buyer from their sale proceeds will be reduced from 6% to 3%. The
reduction in these "seller concessions" can increase the amount of cash
a buyer will be required to pay at closing by $6,000 for a home purchase
of $200,000.

There is only one way to avoid being affected by all of these costly
changes that lie ahead - submit all FHA mortgage applications by the
last week of March.

There you have it. How can I help you to save money and get into your dream home?

Call me at 713.818.0829........ and hurry!
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